Oct 02, 2006. /Lesprom Network/. Stora Enso's Port Hawkesbury mill in Nova Scotia, Canada, will restart operations following a 10-month shutdown due to profitability challenges. The mill will carry out a phased-in approach to getting the two paper machines operating, beginning with the immediate start-up of its paper machine (PM) 2 which has an annual capacity of 360 000 tonnes of super-calendered magazine paper ("SC" catalogue and magazine paper), followed by PM 1, which has an annual capacity of 190 000 tonnes of newsprint. The three main local factors that impact the future profitability of the mill are energy, labour and taxes. Stora Enso has reached the following on these items: Energy: The Nova Scotia Utility and Review Board established a new rate formula for large industrial customers based on the actual cost for Nova Scotia Power Inc. to produce electricity. Labour: The new labour contract allows modern work practices and includes wage concessions. Taxes: The local municipality has agreed to a 10-year realty tax agreement. The province of Nova Scotia has agreed to phase out the capital tax. The mill ceased production on 24 December 2005 due to a labour dispute. The new five-year collective labour agreement (31 May 2004-31 May 2009) was ratified on 20 June 2006. The agreement includes a 10% decrease in wages from the 2006 level, changes to key work practices such as flexibility and overtime, and 54 identified reductions in workforce, which have been achieved through a voluntary early retirement programme. In addition, wage reductions of 10% also applied to all salaried personnel. The agreement was necessary for the mill to achieve profitability with two machines. The restart of the mill after the June ratification by the union was delayed until the issue of high electricity costs was resolved with the local power utility. The Nova Scotia Utility and Review Board recently approved a revised power rate for Extra Large Industrial customers. The impact on the Stora Enso group's operating profit during the shutdown period has been approximately Euro 5 million per month. The Port Hawkesbury mill will continue to face the challenges of the marketplace and the strength of the Canadian dollar, which puts particular pressure on Canadian manufacturing industries exporting to the United States. Stora Enso's Port Hawkesbury mill has been operating in Nova Scotia since 1962. It produces 190 000 tonnes of newsprint and 360 000 tonnes of super-calendered paper for the catalogue and magazine paper markets primarily within North America. Port Hawkesbury Paper mill and its forestry unit are part of the North American operations of Stora Enso Oyj, which also has papermaking facilities at Wisconsin Rapids, Stevens Point, Whiting, Kimberly, Niagara and Biron, Wisconsin; and Duluth, Minnesota.